Another View -- David Fink: When discussing passenger rail, do not forget the costs

DAVID FINKFebruary 07. 2013 10:40PMAs president of Pan Am Railways, the largest freight railroad in New Hampshire, I was surprised to read the recent comments by Nashua Mayor Donnalee Lozeau claiming that "New Hampshire is one of the few states that does not have a functioning rail system for commuter and freight" and that "... freight rail would also be incredibly beneficial to southern New Hampshire."

Unless I am mistaken, freight rail service is already alive and well in both southern and central New Hampshire, with Pan Am Railways being the major provider of such service to a growing customer base that now numbers more than 35 active rail users in the region.

Perhaps more troubling than the mayor's perception of freight service in New Hampshire, however, is a subsequent comment that, "there is no transportation out there that isn't subsidized today . everything is subsidized." With all due respect to the mayor, that statement is simply incorrect when applied to freight railroads such as Pan Am.

In fact, while other transportation modes must rely on subsidies for their operations, Pan Am neither requests nor receives similar subsidies to run its trains and maintain its freight rail infrastructure. Unfortunately, as politicians continue to promote the importance of passenger rail for New Hampshire, there has been no mention of the role that the private railroad owner might play in such an endeavor. It is my sincere hope that this will change as any discussion moves forward.

Nevertheless, I do agree with the mayor that subsidies will be necessary for any passenger rail operation in New Hampshire. My concern, however, is that discussions on this topic have so far failed to quantify the scope of these costs or the benefits to be obtained.

One need look only to the financial demands facing the MBTA in Massachusetts and Amtrak nationally to realize that the operation of passenger service brings many daunting challenges and that the costs of those challenges in New Hampshire will have to be borne by its residents.

Similarly, it is instructive to note the outcome of recent efforts by Minnesota to initiate passenger service to fully understand the risks of such an enterprise. There, a 40-mile rail line was upgraded at a cost of approximately $317 million for service into Minneapolis in 2009. Since the operation of the first train, ridership has consistently failed to meet projections, and the taxpayers of Minnesota are paying a subsidy of approximately $1 million per month to support a service that is failing to meet even muted expectations.

What these examples clearly show is that there are significant costs and risks related to passenger service in New Hampshire, and my concern is that to date the public discussion of this project has been limited only to unidentified "benefits" that will supposedly result.

To be clear, Pan Am has enjoyed long and successful relationships with passenger rail operators such as the MBTA and Amtrak, and we believe that passenger rail can be beneficial in the right circumstances. However, in order to realize these benefits, planners and politicians must also identify, discuss and plan for the inherent risks related to this service.

As it has done with recent MBTA and Amtrak service expansions, Pan Am is willing to participate in any discussion relating to New Hampshire passenger service, provided that all parties are willing to enter those discussions with a realistic expectation of what such service is to achieve.

David Fink is president of Pan Am Railways, based in North Billerica, Mass.